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Want to Buy a Critical Illness Rider? Know How it is Different from Regular Health Insurance Plans

Published On Jan 10, 2021, Updated On Apr 23, 2021

Many of them are unsure about the differences between an independent insurance plan and critical illness insurance and can even use the words interchangeably. The reality is that there is a big difference between critical illness insurance and independent insurance plan, both of which meets a particular need. It is a vital choice to decide on the best insurance plan and it is essential to make an informed decision to make sure that your financial costs do not interfere with your journey towards your goals in life.

Want to Buy a Critical Illness Rider? Know How it is Different from Regular Health Insurance Plans

To help you determine what fits for you, here is a difference between an independent insurance plan and serious illness cover:

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Independent Plan

Critical Illness Insurance

Ailment and expenses covered

An independent insurance planmainly covers expenditures around a hospitalisation. However, hospitalisation accounts for only a certain percentage of the expenses

In critical illness insurance, once you are diagnosed with a critical illness, which is protected by the policy, you get a lump sum. You will cover other expenses with a critical illness cover, including therapy, pathology examination, treatment, post-surgery care, and so on. Not only to cover the high criticalcost of illnesses but also to provide financial protection to mitigate the financial loss caused by serious illnesses is a basic goal of opting for critical illness insurance. Non-Communicable Illnesses, including heart failure and cancer, are usually covered by critical illness insurance.

Benefit Model

An independent insurance planis an indemnity plan covering the actual expenses incurred towards medical treatment. To get the benefits, you will have to submit your actual bills and your medical records.

In critical illnesses insurance, regardless of the actual expense incurred, a lump sum amount is received which will alleviate the financial strain.

Policy Period

Generally, an independentinsurance planis availed for one year at a time and is renewed each year.

Critical Illness insurance is typically purchased for a longer period of time, for example, for 15-20 years.

Waiting Period

In an independent insurance plan, the waiting period is generally 30-90 days, however, it is not applicable in case of an accident.

Critical illness insurance is usually purchased, for a longer time period, for instance, for 15-20 years,

Survival Period

An independent insurance plan does not have any survival period clause.

In the case of critical illness insurance, the insured must live for at least 30 days after diagnosis of the illness to take advantage of the critical illness insurance.

Policy Expiry

Till the conclusion of the policy term, an independent health insurance plan remains active and can be renewed at the end of the policy period.

A critical illness plan ceases to be active once the insurer is diagnosed with a critical illness and the sum insured is paid to the insurer, irrespective of the actual expenditure.


The increasing incidences of Non-Communicable Diseases (NCDs) and the medical treatment cost implies that critical illness insurance is a must-have. A combination of independent insurance and critical illness insurance offers the most comprehensive coverage. While independent plans from one of the leading health insurance companies can be used in case of hospitalisation, critical illness insurance aids in meeting other medical expenses. As such, it is a “win-win combination”.

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